Wednesday, June 19, 2002 05:18:42 AM

[the PRNewswire-FirstCall version of 
the below article was previously sent]

Petronas buys Kerr-McGee's Indonesia subsidiary

KUALA LUMPUR, June 14 (Reuters) - Malaysia's state oil and gas company, Petronas, has bought U.S. firm Kerr-McGee Corp's Indonesian subsidiary for $170 million, it said in a statement on Friday.

Kerr-McGee Indonesia's (KMI) oil and gas properties include a 30 percent non-operating interest in the Jabung block on Sumatra island, which is destined to supply gas to Singapore. "The acquisition of KMI marks a significant extension of Petronas's activities in Indonesia, providing it with its first oil production in the country," the Malaysian firm said.

Gas flow from the Jabung block is due from the third quarter of next year at an initial rate of 68 million standard cubic feet per day (mmscfd), with a plateau rate of 135 mmscfd by 2009.

The Oklahoma City-based Kerr-McGee said the sale to Petronas Carigali Overseas Sdn Bhd, the Malaysian firm's overseas exploration and production subsidiary, was part of plans to rationalise non-core assets and focus on core areas. "The proceeds will be used to reduce debt," it said in a statement released late on Thursday.